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2025 DIGILAW 217 (KAR)

Sapthagiri Shelters v. State of Karnataka

2025-06-05

R.DEVDAS

body2025
ORDER : R. DEVDAS, J. As a fall out of the judgment rendered by a co-ordinate Bench of this Court declaring the Bye-laws under which ground rent, licence fee, scrutiny fee, security deposit etc., was sought to be levied, as ultra vires the Act and therefore unenforceable at the hands of Bruhat Bengaluru Mahanagara Palike (for short ‘BBMP’), amendments were made to the BBMP Act. Several hundreds of petitions are filed by residents and builders raising a challenge to the amendments and the consequential imposts/levy in terms of demands raised by the respondent – BBMP. Therefore, all these writ petitions are clubbed and heard together and disposed of by this common order. 2. In Mr . Sunderam Shetty and Others Vs. State of Karnataka rep. by its Secretary, Urban Development Department and Others , ILR 2021 KAR 3968 – the co-ordinate bench considered whether the impugned imposts/fee suffer from want of legal sanction, insofar as ground rent, licence fee, scrutiny fee, security deposit, lake rejuvenation fee, service charges at 1% of the amount payable to the Palike from out of Building Construction Workers cess – Labour cess. It was held that the levy and collection did not have any legal basis and such action was based on Circulars which had no force of law. Accordingly, Circulars dated 04.09.2015 and 27.01.2017 issued by the BBMP were quashed and set aside. However, it was also held that the State or the BBMP are not precluded from bringing in the impugned levies under the provisions of the Act or the Rules by making suitable amendments to the Act and the Rules. As a consequence, the respondent - State and the BBMP chose to amend and insert the impugned provisions in the Karnataka Municipal Corporations Act, 1976 and the Bruhat Bengaluru Mahanagara Palike Act, 2020 (hereinafter referred to as the ‘BBMP Act’, for short), with retrospective effect for validation of fee and penalty collected by the BBMP at the time of sanction of building ILR 2021 KAR 3968 plans and grant of commencement certificate and completion certificate to buildings and also to provide exemption or concession to Boards or Corporations or Organisations owned or controlled by the Central Government or the State Government from the payment of such fee. 3. 3. One of the main grounds of attack is that the impugned provisions do not in any way set out to change the circumstances under which the imposts/levy were declared as ultra vires in Sunderam Shetty . It is contended that such action is an attempt to nullify the judgment of this Court, without taking due care to remove the basis of the judgment. Several other grounds are raised challenging the impugned amendments and therefore, it would be better to proceed enumerating the broad grounds. 4 (i) In Sunderam Shetty , this Court has already considered the legality of the impugned imposts/levy and has held that such imposts/levy are ultra vires the Act and therefore similar provisions cannot be reintroduced into the Act. 4 (ii) In Sunderam Shetty , this Court has considered the legitimacy of linking guidance value to the fee payable towards building licence/sanction plan and has held that it has no reasonable nexus. However, by the impugned amendment, such fee is once again linked to guidance value. 4 (iii) In Sunderam Shetty , this Court considered the legality of imposition and collection of ground rent, and held that the same cannot be imposed if public property/road/pavement were not utilized for storing construction material. However, care is not taken in the impugned provisions to redress the grievance of such persons. 4 (iv) Imposition of security fee would be additional burden on the owners/builders. The impugned provision does not mandate returning of the security fee. 4 (v) In Sunderam Shetty , it has been held that the impugned levy can be imposed on the basis of quid pro quo and therefore such levy should be commensurate with the services rendered by the BBMP. However, the impugned levy are highly exorbitant and are not commensurate with the services rendered. 4 (vi) In the latest amendment, Act No.37 of 2024, while defining ‘Ground Rent’ to mean and include fee for usage of public roads and other infrastructure facilities provided and maintained by BBMP, the owners/builders who seek plan sanction are singled out for differential treatment and doubly taxed for the same purpose. 4 (vii) In terms of Articles 243W and 243X of the Constitution of India read with the 12 th Schedule, the power to impose taxes pertaining to the impugned levy are vested with the Municipalities. Therefore, such power cannot be delegated to the Commissioner. 4 (vii) In terms of Articles 243W and 243X of the Constitution of India read with the 12 th Schedule, the power to impose taxes pertaining to the impugned levy are vested with the Municipalities. Therefore, such power cannot be delegated to the Commissioner. 4 (viii) Having regard to such powers conferred under Articles 243W and 243X on the Municipalities, provision such as Section 18-A of the Karnataka Town and Country Planning Act, 1961 (for short ‘Act 1961’), and Rule 37-A, B and C of the Karnataka Planning Authority Rules, 1965 (for short ‘Rules 1965’) could not have been inserted, thereby enabling the Planning Authority (Bangalore Development Authority) to levy and collect such fee. 4 (ix) Betterment charges cannot be levied and collected by the BBMP, on delegation of power under the Act, 1961. Such powers are conferred on the Planning Authority to collect betterment charges while sanctioning a layout plan and the same cannot be imposed or collected by the BBMP while sanctioning a building plan. 4 (x) There is no plan or scheme for Mass Rapid Transport System in the city and therefore, the BBMP cannot demand or collect surcharge and cess in that regard. 4 (xi) The fee/surcharge/cess collected by the planning department of BBMP while sanctioning building plans have to be utilized only for the purpose of meeting the administrative expenses of the planning department. However, it is clear from the statement of objections filed at the hands of the respondents that the impugned fees are sought to be collected and utilized for other purposes also. 4 (xii) The respondent-State and BBMP have not preferred any appeal challenging the judgment in Sunderam Shetty . Having accepted the said judgment, the respondents could not have levied the impugned fees without removing the defects pointed out by this Court. 4 (xiii) No reasons are forthcoming either from the statement of objects of the Amending Act or the statement of objections filed by the respondents regarding any tangible information or recommendation from the Finance Commission, while reviewing the finances of the BBMP, for enhancement of the impugned fees. Empirical data is not collected before proceeding to introduce the impugned provisions in the Act and the Rules. The respondents have failed to justify the exorbitant rates. Empirical data is not collected before proceeding to introduce the impugned provisions in the Act and the Rules. The respondents have failed to justify the exorbitant rates. 4 (xiv) The impugned Validating Act/provisions seek to override the judgment of this Court and by introducing a non-obstante clause, the respondents are undermining the power of judicial review conferred on this Court by the Constitution of India. Arguments on behalf of petitioners: 5. Re: Sunderam Shetty - legality of the impugned imposts/levy have been considered and held ultra vires the Act and therefore similar provisions could not have been reintroduced. 6. Sri P.S.Rajagopal, learned Senior Counsel - Similar provisions such as ground rent, licence fee, scrutiny fee, security deposit, lake rejuvenation fee, service charges at 1% of the amount payable to the Palike from out of Building Construction Workers cess – Labour cess, though not expressly provided either in the Act or the Rules, were however, levied and sought to be collected, based on Circulars issued from time to time. In Sunderam Shetty and connected matters, challenge were raised at the hands of several hundred petitioners and this Court held that such levy, not provided in the Act or Rules, could not be levied or collected through Circulars. It was therefore held that such Circulars through which the levy and collection was sought to be made by BBMP was ultra vires the Act. The decision in Sunderam Shetty not only considered the validity of such levy on the basis of Circulars, but also considered the legality of such levy comprehensively. Therefore, the State and BBMP were precluded from bringing in similar provisions, by inserting the same in the Act. This Court may therefore proceed to strike down the impugned provisions, since such provisions have already been held to be illegal and unjust. In this regard, reliance was placed on State of Karnataka and Others Vs. Karnataka Pawn Brokers Association and Others , [ (2018) 6 SCC 363 ] , where it was held that a judicial pronouncement is always binding unless the very fundamentals on which it is based are altered and the decision could not have been given in the altered circumstances. 7. Karnataka Pawn Brokers Association and Others , [ (2018) 6 SCC 363 ] , where it was held that a judicial pronouncement is always binding unless the very fundamentals on which it is based are altered and the decision could not have been given in the altered circumstances. 7. As a counter, it was argued by learned Senior Counsel Sri K.G.Raghavan, on behalf of the respondent- BBMP that since this Court was considering in Sunderam Shetty , the legality of the levy on the basis of Circulars, and it was held that such levy cannot be imposed by way of Circulars, there being no substantial provision in the Act or the Rules, all other observations made in Sunderam Shetty regarding the impugned levy are obiter dicta. 8. Learned Counsel Sri Sammith S., appearing for some of the petitioners has pointed to two judgments, which were in fact relied upon by learned Senior Counsel Sri.K.G.Raghavan, in the case of Secunderabad Club Vs. Commissioner of Income Tax , [(2023) SCC OnLine SC 1004] and Union of India and Others Vs. Dhanwanti Devi and Others , [ (1996) 6 SCC 44 ] , to counter the argument of learned Senior Counsel Sri K.G.Raghavan. It was submitted that in Sunderam Shetty , the co-ordinate Bench has considered each and every aspect of the impugned levy, dehors the levy imposed through Circulars. Since the Apex Court has held that the ratio of the case has to be deduced from the facts involved in the case, it was submitted that the co-ordinate Bench has considered each and every levy and their validity, more particularly the linking of the levy to guidance value. In Dhanwanti Devi too, it was held that in order to understand and appreciate the binding force of a decision it is always necessary to see what were the facts in the case in which the decision was given and what was the point which had to be decided. 9. Sri Sammith S., learned Counsel for some of the petitioners – the respondent-State and BBMP are bound by the mandamus issued by this Court. The respondent–State cannot indirectly take away the benefit conferred on the owners/builders, by amending and inserting the impugned provisions in the Act. The impugned levy are the same which were found in the Circulars impugned before this Court in Sunderam Shetty . The respondent–State cannot indirectly take away the benefit conferred on the owners/builders, by amending and inserting the impugned provisions in the Act. The impugned levy are the same which were found in the Circulars impugned before this Court in Sunderam Shetty . The effect of reintroducing such levy which were struck down by this Court would amount to the respondent-State directly annulling a judgment of this Court. Attention of this Court is drawn to S.T.Sadiq Vs. State of Kerala and Others , [ (2015) 4 SCC 400 ] . In Madras Bar Association Vs. Union of India And Another , [ (2022) 12 SCC 455 ] , it was held that the law does not permit the legislature to take away what has been granted in implementation of a Court’s decision, including interim orders/directions. Nullification of mandamus by an enactment was held, impermissible and it would amount to transgression of constitutional limitations and intrusion into the judicial power by the legislature in violation of the principles of separation of powers, the rule of law and Article 14 of the Constitution. 10. Sri.P.S.Rajagopal, learned Senior Counsel, while pointing out to the statement of objects of the Karnataka Act 01 of 2022, submitted that the Government is clearly of the view that since fee have been collected by the Palike and the same have been utilized for various development works, refund of the same would incur a financial burden of Rs.2362 Crores to the Palike and therefore, it is considered necessary to amend the Act, 1976, Act 2020, with retrospective effect for validation of fee and penalty collected by the Palike. It is therefore clear that the Government has proceeded hastily, without collecting empirical data regarding the expenses incurred by the Planning Department of the Palike and did not arrive at a reasonable rate to be levied and collected, to augment the expenditure of the department. 11. It was argued by the learned Senior Counsel that contrary to Section 376 of the BBMP Act, 2020, where all provisions of the Karnataka Municipal Corporations Act, 1976, pertaining to the BBMP stood repealed by the Karnataka Act No.53 of 2020 w.e.f., 11.01.2021, amendments have been again brought to the Act, 1976, to provisions pertaining to the BBMP. It was contended that in terms of Section 6 of the Mysore General Clauses Act, the repealed provision shall not revive by a subsequent amendment. It was contended that in terms of Section 6 of the Mysore General Clauses Act, the repealed provision shall not revive by a subsequent amendment. It was contended that an amendment is permissible to any of the provisions of a statute and not when there was no such provision at all in the previous statute. It is contended that such an action is nothing but decorating a still born baby. Here again, reliance is placed on the decision in Karnataka Pawn Brokers’ Association . In paragraph No.25 of the said judgment, it was held that the legislature cannot set at naught the judgments which have been pronounced by amending the law not for the purpose of making correction or removing anomalies but to bring in new provisions which did not exist earlier. The legislature may have the power to remove the basis or foundation of the judicial pronouncement but the legislature cannot over turn or set aside the judgment, that too, retrospectively by introducing a new provision. It was also pointed out that in D.Cawasji and Co., Mysore Vs. State of Mysore And Another , [1984 (Suppl) SCC 490] , it was held, “In our opinion, the enhancement of the rate of duty from 6½ per cent 45 per cent with retrospective effect is in the facts and circumstances of the case clearly arbitrary and unreasonable. The defect of lacuna is not even sought to be remedied and the only justification for the steep rise in the rate of duty by the amended provision is to nullify the effect of the binding judgment”. 12. Learned Additional Advocate General Sri.Reuben Jacob, contends that it is not as if the amendment is brought to a dead letter. It is submitted that Karnataka Municipal Corporations Act, 1976, is not totally repealed. The amended provision does not bring in a new levy. No new liability is brought in by the subsequent amendment. It is submitted that the levy of ground rent, license fee, scrutiny fee, security deposit etc., while considering an application for sanctioning a building plan and grant of building license was prevalent even before the subsequent amendments. The levy and collection was made earlier under the Building Byelaws and various Circulars issued by the Government/Corporation. It is submitted that the levy of ground rent, license fee, scrutiny fee, security deposit etc., while considering an application for sanctioning a building plan and grant of building license was prevalent even before the subsequent amendments. The levy and collection was made earlier under the Building Byelaws and various Circulars issued by the Government/Corporation. However, since the co-ordinate Bench held that the byelaws under which the levy was made and collected were ultra vires the Act, the validating provision was required to be brought in, to save the levy and collection already made. 13. Sri. Udaya Holla, learned Senior Counsel appearing for some of the petitioners – In Amarendra Kumar Mohapatra and Others Vs. State of Orissa and Others , [ AIR 2014 SC 1716 ] it was held that when the validity of any such Validation Act is called in question, the courts have to carefully examine the law and determine whether (i) the vice of invalidity that rendered the Act, Rule, proceedings or action invalid has been cured by the validating legislation, (ii) whether the legislature was competent to validate the Act, action, proceedings or Rule declared invalid in the previous judgments, and (iii) whether such validation is consistent with the rights guaranteed by Part III of the Constitution. It is only when the answer to all these three questions is in the affirmative that the Validation Act can be held to be effective and the consequences flowing from the adverse pronouncement of the Court held to have been neutralised. Further, in Avinder Singh And Others Vs. State of Punjab And Others , [ (1979) 1 SCC 137 ] it was held that the levy of taxes shall be only for the purposes of the Act. Diversion for other purpose is illegal. Exactions beyond the requirements for the fulfillment of the purposes of the Act are also invalid. It was therefore contended, while applying the same logical deduction, levy and collection of fee under Chapter XVI of the BBMP Act, 2020, pertaining to regulation of buildings, the levy beyond the requirements for the fulfillment of the purposes of the said chapter are required to be declared invalid. 14. Sri. Vikram Huilgol, learned Senior Counsel – In Calcutta Municipal Corporation and Others Vs. Shrey Mercantile (P) Ltd., and Others , [ (2005) 4 SCC 245 ] , it was held in paragraph No.21, as follows: “21 . 14. Sri. Vikram Huilgol, learned Senior Counsel – In Calcutta Municipal Corporation and Others Vs. Shrey Mercantile (P) Ltd., and Others , [ (2005) 4 SCC 245 ] , it was held in paragraph No.21, as follows: “21 . Now coming to the question of challenge to the levy as arbitrary and discriminatory and violative of Article 14, we find that the functions of the Corporation with regard to mutation remain the same, whether the applicant is a transferee under a conveyance or a lessee or a beneficiary under a Will or an heir in the case of intestate succession. Once an application for mutation is made, the same is examined by the department and after hearing the objections, if any, the record is ordered to be changed. Ultimately, the exercise is for fiscal purpose. Similarly, the property valuation may be below Rs.50,000 or above Rs.2 lakhs, the function of the Corporation in making the mutation entry remains the same. Similarly, whatever may be the cause of mutation, whether it is a case of transfer or devolution, the activity of mutation remains constant in all the cases. The expenses incurred in all the cases also cannot vary, whatever be the value of the property or the cause of mutation. In the circumstances, there is no reason given for charging different rates depending on the value of the property and the cause of transfer. By doing so, the incidence of the levy falls differently on persons similarly situated resulting in violation of Article 14 of the Constitution. Moreover, the quantum of fees is disproportionate to the so-called “services” which is one more circumstance showing arbitrariness in the levy of such imposition. So far as Article 14 is concerned, the courts in India have always examined whether the classification was based on intelligible differentia and whether the differentia had a reasonable nexus with the object of legislation.” 15. Re: the legitimacy of linking guidance value to the fee payable towards building licence/ sanction plan. 16. Sri.P.S.Rajagopal, learned Senior Counsel - the respondent/Palike has the monopolistic power to consider and sanction a building plan and issue building license. It cannot attempt profiteering and such adventurous attitude of the State and the Palike to take advantage of its monopolistic power cannot be sustained. It was contended that in Association for Democratic Reforms and Another (Electoral Bond Scheme) Vs. It cannot attempt profiteering and such adventurous attitude of the State and the Palike to take advantage of its monopolistic power cannot be sustained. It was contended that in Association for Democratic Reforms and Another (Electoral Bond Scheme) Vs. Union of India and Others , [ (2024) 5 SCC 1 ] , it was held that a statute or a provision can be challenged on the ground of manifest arbitrariness. 17. Sri. Sammith S, learned Counsel – in Sunderam Shetty , it was held that imposition of such fee can only be as quid pro quo. In Secunderabad Hyderabad Hotel Owners’ Association And Others Vs. Hyderabad Municipal Corporation, Hyderabad and Another , [ (1999) 2 SCC 274 ] it was held that since the conditions of license not only imposed certain obligation on the licensee, but also require the corporation to ensure compliance with the conditions of the license by inspecting the licensee’s premises, the said levy is a fee and not a tax. A license fee may be either regulatory or compensatory. However, when a fee is charged for rendering specific services, certain element of quid pro quo must be there between the services rendered and fee charged, so that the license fee is commensurate with the cost of rendering the service, although exact arithmetical equivalence is not expected. 18. Learned Counsel Ms. Nayana Tara B.G., appearing for some of the petitioners – while pointing out to the amended provisions of the BBMP Act, more particularly, sub- section (2) of Section 240-A, it is submitted that the amended provision enables the Chief Commissioner, while fixing the rates for levy of fee or penalty, to consider all the costs related to the issue and the execution of the approval. It is also pointed out that the words ‘lake rejuvenation’ and ‘compound wall charges’ are not found in the said provision. It is therefore submitted that levy and collection of lake rejuvenation fee and compound wall charges are illegal. It is submitted that such a provision for collecting compound wall charges at the rate of Rs.1/- per running meter was made in Clause 3.7.3 of the BBMP Building Bye-laws. It is submitted that levy and collection of compound wall charges violate Article 243X of the Constitution of India, since even the amended provision does not provide for levy and collection of lake rejuvenation fee and compound wall charges. It is submitted that levy and collection of compound wall charges violate Article 243X of the Constitution of India, since even the amended provision does not provide for levy and collection of lake rejuvenation fee and compound wall charges. Similar is the position regarding security fee/ deposit . 19. It is submitted that levy of security fee/deposit is illegal and it is an additional burden on the owners of the property. It is submitted that in Sunderam Shetty , this Court has quashed the Circulars on the basis of which BBMP was imposing lake rejuvenation fee and further, since no such provision is made in the amended Act, such levy is clearly illegal. 20. Learned Counsel submitted that the petitioners in her case have not filed any application under Sections 14 or 17 of the Karnataka Town and Country Planning Act, 1961, seeking approval from the Planning Authority for formation of a layout or for sanction of sub-division of plots or layout of private streets. Such being the position, recovery of a fee while granting permission for development of building or land cannot be permitted. 21. It is submitted that although a notification dated 26.02.2004 is said to have been issued and gazetted in compliance of Section 2(4) of the Act, 1961, delegating such powers to the local authority (BBMP), the provisions under Section 18A is under challenge in some of these writ petitions. It is also contended that the argument regarding levy and collection of security deposit would also apply to Scrutiny Fee, which is not provided for even in the amended provision of Section 240A of the BBMP Act. 22. It is also submitted that levy and collection of such fee for modification of plan would amount to double payment. There is no such provision either under the old Act or the amended Act for levy and collection of similar fee on modified plan. It is submitted that the petitioners had obtained a sanctioned plan in the year 2016 while paying all the levies. However, while sanctioning the modified plan, once again similar fees are levied on the entire extent of built up area and sital area. There is no provision making any distinction for cases of fresh plan and modified plan. 23. It is submitted that the petitioners had obtained a sanctioned plan in the year 2016 while paying all the levies. However, while sanctioning the modified plan, once again similar fees are levied on the entire extent of built up area and sital area. There is no provision making any distinction for cases of fresh plan and modified plan. 23. Learned Counsel has also submitted that levy and collection of betterment fee as provided in Section 18 of the KTCP Act, 1961, while sanctioning a building plan is contrary to the provisions contained in the Act, which pertains to the Planning Authority which is empowered to sanction a layout plan and not a building development plan. 24. Attention of this Court is also drawn to sub-rules (2) and (3) of Rule 37-C of the Karnataka Planning Authority Rules, 1965, which provides that the cess and surcharge collected under sub-clause (i), (ii) (iii) and (iv) of sub-section (1) of Section 18-A shall be deposited in a separate head of account by the Planning Authority/Local Authority which issues the building plan and thereafter, the amount so collected shall be transferred to the concerned authority as per the directions of the Government, while retaining 5% as service charges. This clearly shows that provisions are sought to be made for levy and collection of cess and surcharge from owners of individual sites who approach the local authority for sanction of a building plan, in violation of the provisions and the objectives with which the KTCP Act is enacted. 25. Learned Counsel Sri.B.Pramod, appearing for some of the petitioners – has drawn the attention of this Court to the technical term and definitions provided in the Zoning of Land Use and Regulations, Revised Master Plan 2015, Bangalore, more particularly, the definition of the word ‘Development Plan’ which provides that ‘Residential Development Plan’ is a plan containing proposal for construction of one or more residential buildings on a plot measuring more than 20,000 square meters in extent. Similarly, “Non-Residential Development Plan” would mean a plan containing proposal for construction of one or more commercial building on a plot size measuring more than 20,000 square meters in extent (which was earlier 12,000 square meters). Similarly, “Non-Residential Development Plan” would mean a plan containing proposal for construction of one or more commercial building on a plot size measuring more than 20,000 square meters in extent (which was earlier 12,000 square meters). Learned Counsel would therefore submit that at any rate such levy and collection of fee/cess/surcharge, etc., arising out of the provisions of the KTCP Act, 1961, is not permissible and not applicable to development plans, if they are not in respect of a plot measuring more than 20,000 square meters. 26. Learned Counsel Sri.B.Pramod, has also placed reliance on a decision of a Division Bench of this Court in W.A.No.335 of 2022 and connected matters, decided on 28.09.2022, where it is held that in terms of the definition of the term “specified authority” as provided in Section 2(7) of the KTCP Act, 1961, BBMP is not the specified authority under Section 17 of the Act. 27. Learned Counsel Sri.T.P.Vivekananda, appearing for some of the petitioners – submits that Section 107 of the BBMP Act, confers powers and functions of the Corporation. It provides that it shall be the duty of the corporation to render necessary services to the inhabitants of the Corporation area in respect of the matters enumerated as core functions in the First Schedule. Sub-section (3) provides that the annual budget allocation, in respect of the subjects provided in the First Schedule, by the Government shall be wholly allotted to the Corporation. Sub-section (4) provides that the Corporation shall manage institutions and administer the schemes allotted to it, subject to the guidelines and technical directions from the Government in accordance with the State and National Policies. Section 109 provides that the core functions of the Corporation shall constitute the first charge on the Corporation fund. It is therefore submitted that maintenance of roads, footpaths, etc., are the core functions of the Corporation and therefore, funds for maintenance of roads and footpaths should come from the Corporation fund and the Corporation cannot levy fee while sanctioning the plans. 28. It is therefore submitted that maintenance of roads, footpaths, etc., are the core functions of the Corporation and therefore, funds for maintenance of roads and footpaths should come from the Corporation fund and the Corporation cannot levy fee while sanctioning the plans. 28. Learned Counsel would further submit that the provisions of the Karnataka Municipal Corporation (Recovery of Improvement Expenses) Rules, 2009, enable the Commissioner to levy and collect such improvement expenses from the owner or occupier of undeveloped, partially developed or single unit properties or group of properties or locality or extension that are assessed or newly added to the Assessment Register and which have been benefited or likely to be benefited by such improvement expenses incurred by the corporation. It is therefore submitted that when the corporation is empowered to levy and collect improvement expenses along with the property tax, such levy while sanctioning the plans for development would be illegal and if permitted to be collected, it would amount to double payment. 29. Re : In the latest amendment, Act No.37 of 2024, while defining ‘Ground Rent’ to mean and include fee for usage of public roads and other infrastructure facilities provided and maintained by BBMP, the owners/builders are singled out for differential treatment and doubly taxed for the same purpose, all the learned Counsels have contended that the definition now provided to “Ground Rent” would clearly demonstrate that additional burden is sought to be fastened on the owners who seek building plans at the hands of the corporation. It is submitted that it is not the owners who seek building plans alone who use the public roads and other infrastructure facilities. Therefore, such levy cannot be made on the owners who seek building plans. 30. It is also submitted that this Court in Sunderam Shetty , has already considered this aspect of the matter and has held that such levy of Ground Rent would be illegal. This Court, in Sunderam Shetty has observed that the petitioners in most of the petitions who have their own space in the construction area to store or stock materials for construction would not be using public roads for storing the building materials. Those who are stocking construction materials in their own land, without using public property/road/pavement are also made to pay ground rent as it is made a condition precedent for issuance of license, occupancy certificate or a plan sanction. Those who are stocking construction materials in their own land, without using public property/road/pavement are also made to pay ground rent as it is made a condition precedent for issuance of license, occupancy certificate or a plan sanction. This Court had therefore observed that there cannot be a better example of non-application of mind in raising the demand under the impugned levies. This Court further held that hitherto, the citizens were paying ground rent, however, by virtue of the circular dated 04.09.2015, the revised ground rent was linked to the guidance value. 31. Re : Legitimacy of linking guidance value to the fee payable to the building license/sanctioned plan, although in Sunderam Shetty , this Court has already held that it has no reasonable nexus, all the learned Counsels have vehemently contended that the argument that the city has to be kept clear, roads have to be kept in order and other manifold activities, all the levies are valid as they are taken into the BBMPs funds and the funds are regulated under the Act, has been rejected by this Court and held that such argument is unsustainable as the power under the Act for imposition of such levy were unavailable at that point of time. 32. It is submitted that, although provision is now made in the amended Act, under Clause(a) of sub-section(3) of Section 240-A of the BBMP Act, 2020, linking the fee to the guidance value fixed by the Department of Stamps and Registration, nevertheless, it cannot be sustained since such linking has no nexus with the fee leviable for sanctioning a plan or issuance of occupancy certificate. It is once again contended that this Court in Sunderam Shetty has clearly held that since the incidence of levy in the present context is a fee and not a tax, there has to be an element of quid pro quo. The service rendered by the BBMP while sanctioning a plan or issuing occupancy certificate, forms the basis for levy of fee. The extent of service may, at the most, depend on the size of the plot and the extent of construction and it has definitely no connection with the value of the land or construction. Therefore, linking the guidance value to the fee towards building license/sanction plan cannot be sustained. 33. The extent of service may, at the most, depend on the size of the plot and the extent of construction and it has definitely no connection with the value of the land or construction. Therefore, linking the guidance value to the fee towards building license/sanction plan cannot be sustained. 33. Re : Imposition of Security Fee and there being no provision for returning the Security Fee, learned Counsels have contended that the owners of the land/ building are not entering into a contract with the corporation. Therefore, it is beyond comprehension as to how and why the owners are asked to deposit security fee. It is submitted that it is the duty of the officials of the corporation to ensure that the construction is put up in accordance with the sanctioned plan. Provision is also available either in the amended Act or under the Building Bye-laws for compounding/regularizing the deviation to a certain extent. Beyond the permissible extent, if there is any further deviation, the same can be directed to be removed in accordance with law. Therefore, it is submitted, that the owners cannot be compelled to deposit security fee. It is also submitted that no specific provision is available for return of the security fee. Learned Counsels have also submitted that scrutiny fee cannot be permitted to be collected exclusively, since such act of scrutiny of the applications and the inspection of the property forms part of the basic functions of the officials of the corporation. Respondents arguments: 34. Learned Senior Counsel Sri.K.G.Raghavan, appearing for the BBMP – At the outset, learned Senior Counsel has pointed out from the operative portion of the orders passed in Sunderam Shetty , that the State or the BBMP was granted liberty for bringing in the levies under the provisions of the Act or the Rules, by making suitable amendments to the Act and the Rules. Learned Senior Counsel would therefore submit that the impugned amendments to the Act and the Rules have been brought in following the directions issued and liberty granted in Sunderam Shetty . Learned Senior Counsel would therefore submit that the impugned amendments to the Act and the Rules have been brought in following the directions issued and liberty granted in Sunderam Shetty . In that view of the matter, it is submitted that this Court was considering the case in Sunderam Shetty and other matters, the legality of the levy and imposts under various circulars issued by the State Government and this Court declared that such levy and imposts are not permissible without enabling provisions in the Act and the Rules. All other observations made in Sunderam Shetty are obiter dicta. It is submitted that since this Court in Sunderam Shetty concluded that such levy and imposts had no legal backing and proceeded to quash the impugned circulars therein, all other observations are mere observations and they cannot be the decision of the court. 35. In this regard, learned Senior Counsel has placed reliance on several decisions including Career Institute Educational Society Vs. Om Shree Thakurji Educational Society , [ (2023) 16 SCC 458 ] where it was held that to test whether a particular proposition of law is treated as ratio decidendi of the case, the proposition is to be inversed, i.e., to remove from the text of the judgment as if it did not exists. If the conclusion of the case would still have been the same even without examining the proposition, then it cannot be regarded as the ratio decidendi of the case. Learned Senior Counsel would therefore submit that since this Court in Sunderam Shetty was considering the sustainability of the levy and imposts based on circulars issued by the Government and having held that the circulars cannot be sustained, if all other observations are removed, in terms of the inversion test, as proposed in the judgment of the Apex Court, the conclusion in Sunderam Shetty , will still remain the same, even without examining the other proposition. Therefore, the decision in Sunderam Shetty cannot be regarded as ratio decidendi, in respect of the propositions to be considered by this Court, moreso, since this Court is to now consider the amended provisions of law and not the earlier circulars issued by the Government. 36. Re : Linking of guidance value – learned Senior Counsel, while placing reliance on Jalkal Vibhag Nagar Nigam and Others Vs. 36. Re : Linking of guidance value – learned Senior Counsel, while placing reliance on Jalkal Vibhag Nagar Nigam and Others Vs. Pradeshiya Industrial and Investment Corporation and Another , [ (2021) 20 SCC 657 ] submitted that the differentiation based on the element of quid pro quo in the case of a fee and its absence in the case of tax, was held to have gradually, yet steadily obliterated to the point where it lacks any practical or constitutional significant. It was held that the distinction that while a tax is a compulsory exaction, a fee constitutes a voluntary payment for services rendered does not hold good. In Ram Bahdur Thakur & Co. And Another Vs. State of Karnataka , [ AIR 1979 KAR 119 ] it was held that a fee being a levy in consideration of rendering service of a particular type, correlation between the expenditure incurred by the government and the levy must undoubtedly exist, but a levy will not be regarded as a tax merely because of the absence of uniformity in its incidence or because of compulsion in the collection thereof, nor because some of the contributories do not obtain the same degree of service as others may. 37. Learned Senior Counsel submitted that for the purpose of fixing rate, the legislature is empowered to adopt any of the options available. The State Government has thought it fit to adopt the guidance value notified by the State Government under Section 45-B of the Karnataka Stamp Act, 1957, as a standard of measure to fix the rate. It is also submitted that the guidance value notified by the State Government was also questioned and the same has been upheld at the hands of the Apex Court in the case of The District Registrar, Shimoga District and Another Vs. Smt. Manjula and Others , [2013 SCC OnLine Kar 10292] 38. Insofar as the contentions of the petitioners that the power conferred on the Chief Commissioner to fix the rate as being violative of Article 243X of the Constitution of India, learned Senior Counsel submitted that the word ‘Chief Commissioner’ may be read down as ‘Corporation’, having regard to the present scenario where the Council of the Corporation is not in existence. 39. 39. Re : Reliance sought to be placed by the petitioners on the statement of objects and reasons to the amended provisions – learned Senior Counsel would place reliance on Bakhtawar Trust and Others Vs. M.D.Narayan And Others , [ (2003) 5 SCC 298 ] , where it was held that when a validity of a particular statute is brought into question, a limited reference, but not reliance, may be made to the statement of objects and reasons. The statement of objects and reasons may therefore be employed for the purpose of comprehending the factual background, the prior state of legal affairs, the surrounding circumstances in respect of the statute and the evil which the statute has sought to remedy. It is manifest that the statement of objects and reasons cannot, therefore, be the exclusive footing upon which the statute is made a nullity through the decision of court of law. Learned Senior Counsel would therefore submit that merely because it is stated in the statement of objects and reasons of the amending provisions that fee have been collected by the Palike and the same have been utilized for various development works, refund of the same would incur a financial burden of Rs.2362 Crores to the Palike and therefore it is necessary to amend the Act, with retrospective effect for validation of fee and penalty collected by the Palike, the amending Act cannot be struck down. 40. On the other hand, it is submitted that it is a well settled position of law that the legislature has the power to enact a law retrospectively or give effect to the provision with retrospectivity. Reliance is placed on NHPC Limited Vs. State of Himachal Pradesh, Secretary and Others , [ (2023) 17 SCC 1 ] wherein the earlier decision in Shri.Prithvi Cotton Mills Limited And Another Vs. Broach Borough Municipality And Others , [ AIR 1970 SC 192 ] was also noticed, where it was held that validation of a tax so declared illegal may be done only if the grounds of illegality or invalidity are capable of being removed or in fact removed and the tax is thus made legal. Sometimes, this is done by providing for jurisdiction where jurisdiction had not been properly invested before. Sometimes, this is done by providing for jurisdiction where jurisdiction had not been properly invested before. Sometimes, this is done by re-enacting retrospectively a valid and legal taxing provision and then by fiction making a tax already collected to stand under the re-enacted law. Sometimes, the Legislature gives its own meaning and interpretation of the law under which the tax is collected and by a legislative fiat makes the new meaning binding upon courts. 41. Learned Senior Counsel would submit that undisputedly provisions were available under the Karnataka Municipal Corporations Act, 1976, enabling the corporation to make Building Bye-laws for the regulation or restriction of the use of site and building and for the regulation or restriction of the building. Accordingly, the Building Bye-laws made by the Corporation were notified by the State Government. It is not disputed that the power to grant building license and approve the plans for constructions vests with the corporation and for that purpose fee were levied and collected. However, this Court in Sunderam Shetty , found that there were no enabling provision in the statute for levy and collection of fee. In the operative portion of the order in Sunderam Shetty , since liberty has been granted to enact appropriate law providing for such levy and collection of fee and accordingly, the impugned amendments have been brought to the Karnataka Municipal Corporations Act, 1976, and the BBMP Act, 2020. The respondent-State Government and the BBMP have accordingly enacted a law to validate the levy and collection of fee, which the corporation is otherwise entitled to levy and collect in terms of the powers conferred on the municipalities, in the Constitution of India. Learned Senior Counsel has also submitted that linking of the fee to guidance value is not a new concept. Such principles are adopted by the corporations in Mumbai and Kolkata. 42. Learned Senior Counsel Sri.Ravi B Naik, also appearing for the respondent-BBMP has made submissions similar to the submissions made by the learned Senior Counsel Sri.K.G.Raghavan. 43. Learned Sri.Reuben Jacob, learned Additional Advocate General (for short, ‘AAG’), appearing for the respondent/State - while placing reliance on Bangalore Development Authority Vs. Aircraft Employees’ Cooperative Society Limited And Others , [ (2012) 3 SCC 442 ] , submitted that while considering the constitutional validity of a statute or a provision of law, courts have revolved certain well established principles as rules of guidance. Aircraft Employees’ Cooperative Society Limited And Others , [ (2012) 3 SCC 442 ] , submitted that while considering the constitutional validity of a statute or a provision of law, courts have revolved certain well established principles as rules of guidance. The first rule is that there is always a presumption in favour of the constitutionality of a statute and the burden is upon him who attacks it to show that there has been a clear transgression of the constitutional principles. The Apex Court has held in the said case that while examining the issue of hostile discrimination, courts cannot be oblivious of the fact that due to unprecedented increase in the cities such as Bengaluru, authorities such as Bangalore Development Authority were obliged to take effective measures to improve the civic amenities like water supply, electricity, roads, transportation, etc., and for this it became necessary to augment the resources by BDA itself or through other state agencies/instrumentalities by making suitable contribution. It was also held that it is not possible for the legislature to enact laws with minute details to deal with increasing complexities of governance in a political democracy, and held that the legislature can lay down broad policy principles and guidelines and leave the details to be worked out by the executive and the agencies/ instrumentalities of the State and that the delegation of the powers upon such authority to implement the legislative policy cannot castigated as excessive delegation of legislative power. 44. Learned AAG has brought to the notice of this Court a notification dated 26.02.2004, published in the official Gazette on 31.03.2011, which delegates the powers under Sections 14, 15, 18, 24, 35(2), 46 and 47 of the KTCP Act, to the Commissioner of the Corporation of the Bangalore city, in exercise of power conferred under Section 81 of the Act. Learned AAG submitted that the Government has legally delegated the powers exercisable by the Planning Authority under the provisions of the KTCP Act, more particularly, Section 18(1-A), regarding levy and collection of additional prescribed fee for rejuvenation of lakes or tanks. Learned AAG would therefore submit that the challenge raised by some of the petitioners in this regard is required to be dismissed. Learned AAG has further submitted that cess and surcharge are held to be Tax and therefore, the requirement of quid pro quo would not arise in cases of cess and surcharge. Learned AAG would therefore submit that the challenge raised by some of the petitioners in this regard is required to be dismissed. Learned AAG has further submitted that cess and surcharge are held to be Tax and therefore, the requirement of quid pro quo would not arise in cases of cess and surcharge. 45. Learned AAG submitted that in fiscal matters there needs to be a greater latitude and merely because the petitioners contend that the rate of the levy is excessive, this court should not interfere in such matters, moreso, since it is a matter of policy. Learned AAG would further submit that since the rate is fixed, there is uniformity and the petitioners cannot contend that the power is being exercised arbitrarily. It is also submitted that the respondents need not establish that each and every applicant is receiving similar benefit as that of the other. 46. Heard learned Senior Counsels Sri.P.S.Rajagopal, Sri.Udaya Holla, Sri Vikram S. Huilgol, learned Counsel Sri Sammith S, Sri.B.Pramod, Sri.T.P.Vivekananda, Ms. Nayana Tara B.G., Sri Shravanth Arya Tandra, Sri Sudhakar G.V., Sri P.K.Srikara and Sri Lokesh L.N., appearing for the petitioners and learned Senior Counsels Sri.K.G.Raghavan, Sri.Ravi B Naik, Sri.Reuben Jacob, learned Additional Advocate General, Smt.Amaravathy, Additional Government Advocate and learned Counsels K.B.Monesh Kumar, Sri K.Krishna, appearing for the respondent-State, BBMP and BDA. 47. The gravamen of the contentious issue is whether the impugned levy and imposts could be considered as arbitrary, irrational and whether the impugned amended provisions are valid, having retrospective effect for validation of fee and penalty collected by the BBMP at the time of sanction of building plans and grant of commencement certificate and completion certificate? 48. While learned Senior Counsel Sri.K.G.Raghavan has laid emphasis on a three judges decision in Jalkal Vibhag learned Senior Counsel Sri.P.S.Rajagopal, has pointed out to a more recent decision in Association for Democratic Reforms , which is rendered by a Constitutional Bench of five judges. It is true that in Jalkal Vibhag , it has been held that the distinction between a tax and fee has substantially been effaced in development of constitutional jurisprudence. While concluding, it was held in paragraph No.66 as follows: “66. In view of this consistent line of authority, it emerges that the practical and even constitutional, distinction between a tax and fee has been weathered down. While concluding, it was held in paragraph No.66 as follows: “66. In view of this consistent line of authority, it emerges that the practical and even constitutional, distinction between a tax and fee has been weathered down. As in the case of a tax, a fee may also involve a compulsory exaction. A fee may involve an element of compulsion and its proceeds may form a part of the Consolidated Fund. Similarly, the element of a quid pro quo is not necessarily absent in the case of every tax. In the present case, the tax has been imposed by the legislature in Section 52 on premises situated within the area of the Jal Sansthan. The proceeds of the tax are intended to constitute revenue available to the Jal Sansthan to carry out its mandatory obligations and functions under the statute of making water and sewerage facilities available in the area under its jurisdiction. The levy is imposed by virtue of the presence of the premises within the area of the jurisdiction of the Jal Sansthan. The water tax is levied so long as the Jal Sansthan has provided a stand post or waterworks within a stipulated radius of the premises through which water has been made available to the public by the Jal Sansthan. The levy of the tax does not depend upon the actual consumption of water by the owner or occupier upon whom the tax is levied. Unlike the charge under Section 59 which is towards the cost of water to be supplied by the Jal Sansthan according to its volume or, in lieu thereof on a fixed sum, the tax under Section 52 is a compulsory exaction. Where the premises are connected with water supply, the tax is levied on the occupier of the premises. On the other hand, where the premises are not so connected, it is the owner of the premises who bears the tax. The levy under Section 52(1) is hence a tax and not a fee. Moreover, for the reasons that we have indicated above, it is a tax on lands and buildings within the meaning of Entry 49 of List II.” 49. The levy under Section 52(1) is hence a tax and not a fee. Moreover, for the reasons that we have indicated above, it is a tax on lands and buildings within the meaning of Entry 49 of List II.” 49. However, as rightly pointed out by learned Senior Counsel Sri.P.S.Rajagopal, in Jalkal Vibhag , the Apex Court was considering a challenge to the constitutional validity of Section 52(1)(a), 55(b)(i) and Section 56 of the U P Water Supply and Sewerage Act and the Apex Court concluded that the levy under Section 52 is a tax simpliciter and cannot be regarded either as a charge or a fee for a service rendered. On the other hand, the Constitutional Bench in Association of Democratic Reforms has considered whether a legislative enactment can be challenged on a sole ground of manifest arbitrariness. It was noticed that traditionally, Article 14 was understood to only guarantee non-discrimination. In the ensuing years, the Apex Court followed the traditional approach to test the constitutionality of legislation on the touch stone of Article 14. It is noticed that while courts accepted the settled proposition of law that a subordinate legislation can be challenged on the ground of a manifest arbitrariness, there was still some divergence to the doctrine’s application with respect to plenary legislation. The Apex Court has taken note of various judgments, including Shayara Bano Vs. Union of India And Others , [ (2017) 9 SCC 1 ] , and Indian Express Newspapers (Bombay) Pvt. Ltd. And Others Vs. Union of India And Others , [ (1985) 1 SCC 641 ] where it was held that manifest arbitrariness must be something done by the legislature capriciously, irrationally and/or without adequate determining principle. It was further held that a legislation which is excessive and disproportionate would also be manifestly arbitrary. In paragraphs No.200, 200.1 and 200.2, it is held as follows: “200. It is now a settled position of law that a statute can be challenged on the ground it is manifestly arbitrary. The standard laid down by Nariman J., in Shayara Bano has been citied with approval by the Constitution Benches in Navtej Singh Johar and Joseph Shine. Courts while testing the validity of a law on the ground of manifest arbitrariness have to determine if the statute is capricious, irrational and without adequate determining principle, or something which is excessive and disproportionate. Courts while testing the validity of a law on the ground of manifest arbitrariness have to determine if the statute is capricious, irrational and without adequate determining principle, or something which is excessive and disproportionate. This Court has applied the standard of “manifest arbitrariness” in the following manner: 200.1. A provision lacks an “adequate determining principle” if the purpose is not in consonance with constitutional values. In applying this standard, Courts must make a distinction between the “ostensible purpose”, that is, the purpose which is claimed by the State and the “real purpose ”, the purpose identified by Courts based on the available material such as a reading of the provision; and 200.2. A provision is manifestly arbitrary even if the provision does not make a classification.” 50. And finally, it was concluded in paragraph No.215, as follows: “The proposition on the principle of manifest arbitrariness culled out above needs to be recalled. The doctrine of manifest arbitrariness can be used to strike down a provision where : (a) the legislature fails to make a classification by recognizing the degrees of harm; and (b) the purpose is not in consonance with constitutional values.” 51. That being the position, the contention of the respondents that the petitioners cannot question the impugned levy and imposts on the ground of arbitrariness, cannot be sustained. 52. In the considered opinion of this Court, the respondents had an opportunity to reconsider the rate of levy and imposts, while formulating the new law/provisions, pursuant to the judgment in Sunderam Shetty Unfortunately, the respondents have simply reiterated the rate of levy and imposts which were struck down, although in the form of circulars issued by the Government. The BBMP did not place any material before the Government and the Government did not undertake any exercise to collect empherical data to fix the rates and provide any reason to link the rates with the guidance value. 53. It is never the case of the Government or the BBMP that the impugned levy and imposts are in the nature of tax. Therefore, when admittedly, the impugned levy and imposts are in the nature of fee, leviable and collectable on account of the services rendered by the BBMP, while considering the applications for plan sanction, issuance of completion certificate and issuance of occupancy certificate, the applicable rates should be commensurate to the services rendered by the BBMP. Therefore, when admittedly, the impugned levy and imposts are in the nature of fee, leviable and collectable on account of the services rendered by the BBMP, while considering the applications for plan sanction, issuance of completion certificate and issuance of occupancy certificate, the applicable rates should be commensurate to the services rendered by the BBMP. In other words, the concept of quid pro quo is definitely applicable in the facts and circumstances of the case. The finding on this aspect of the matter in Sunderam Shetty could not have been ignored by the respondents. Some of the learned Counsels appearing for the petitioners have placed on record the financial facts extracted from the website of the BBMP to buttress their argument that neither the BBMP nor the Government have considered the relevant factors such as the financial expenses incurred by the BBMP in the matter of considering applications for plan sanction, issuance of completion certificate and issuance of occupancy certificate; the financial expenses incurred on account of the field work and the supervision of the projects pursuant to the sanctions granted by the BBMP. Therefore, here is a clear case where the impugned levy and imposts fail to meet the basic requirements of the concept of quid pro quo. 54. Further, the linking of the rates to the guidance value should also meet the same fate, since the said aspect of the matter should also meet the requirement of quid pro quo. It is for the respondents to supply acceptable reasons for linking the rates to the guidance value. The contention of the petitioners is that the levy and imposts in the matter of consideration of the applications for plan sanction, issuance of completion certificate and issuance of occupancy certificate should have uniform application and cannot vary from locality to locality and the same does not depend on the market value of the properties. It is their contention that the services rendered by the BBMP in such matters have nothing to do with the market value of the properties. Prima facie, such contentions are reasonable and tenable. At best, the rates remaining uniform, the levy however, can vary depending on the size of the plot and the extent of construction. That is because the extent of services to be rendered by the BBMP may vary depending on the size of the plot and the extent of construction. Prima facie, such contentions are reasonable and tenable. At best, the rates remaining uniform, the levy however, can vary depending on the size of the plot and the extent of construction. That is because the extent of services to be rendered by the BBMP may vary depending on the size of the plot and the extent of construction. The amount of time to be spent by the BBMP will definitely vary depending on the size of the plot and the extent of construction. 55. On the other hand, this Court does not see any acceptable reason or logic in linking the rates with the guidance value, which is nothing but the approximate market value notified by the Government under the provisions of the Karnataka Stamp Act. The notification providing the guidance value is issued under Section 45-B of the Karnataka Stamp Act, for the purposes of determining the market value of the lands in the matter of registration and stamps of documents. Surely, the impugned levy and imposts which are on account of the services to be rendered by the BBMP in the present context, has nothing to do with the market value of the properties. Apparently, there is no rational nexus between the rates and linking of the same to the guidance value. Therefore, this Court is also of the considered opinion that the linking of the impugned levy and imposts to the guidance value cannot be sustained. 56. Re : The levy and imposts arising out of the Karnataka Town and Country Planning Act, 1961, and the Karnataka Planning Authority Rules, 1965 – here again the fees to be levied under Rule 37-A for the purpose of sub- section (1) of Section 18 is sought to be linked with ‘market value’ which is again determined as per the guidance value of the land in accordance with Section 45-B of the Karnataka Stamp Act. Since this Court is of the opinion that there is no rational nexus between the rates prescribed and the guidance value/ market value, the issue is answered accordingly. 57. Insofar as, Rule 37-C of the Karnataka Planning Authority Rules, 1965, is concerned, the levy is in the form of cess and surcharge. Since this Court is of the opinion that there is no rational nexus between the rates prescribed and the guidance value/ market value, the issue is answered accordingly. 57. Insofar as, Rule 37-C of the Karnataka Planning Authority Rules, 1965, is concerned, the levy is in the form of cess and surcharge. However, the levy is towards the development cess/surcharge at different percentages under the table provided for in Rule 37-A serial number 1 to 6, which again arise out of Section 18-A of the KTCP Act. 58. Although, it has been contended by the learned AAG that these levy arising out of Section 18-A of the KTCP Act are in the form of cess and surcharge and they cannot be equated to a fee, nevertheless, what is noticeable is that these levy arise out of grant of permission for development of land or building. For the present, this Court is concerned about the impugned demand notices issued by the BBMP in matters of sanctioning the plan/building license/issuance of commencement certificate, completion certificate and occupancy certificate. 59. It is relevant to notice that the Apex Court in the case of Bangalore Development Authority Vs. Aircraft Employees Cooperative Society Limited , [ (2012) 3 SCC 442 ] , while considering BDA’s power of levying charges under Section 32(5-A) of Bangalore Development Authority Act, 1976, for sanctioning new private layouts/extensions to meet expenditure incurred towards execution of schemes/works of augmentation of amenities within the Bangalore Metropolitan area, held that there could be no justification to transfer the burden of this expenditure on the residents of the areas which were already part of the city of Bangalore. In other words, other residents could not be called upon to share the burden of cost of the amenities largely meant for the newly developed areas. The respondents are therefore required to reconsider the application of the said provision in Section 18-A of the KTCP Act, indiscriminately, in respect of every proposed development plan. At best, the said provision can be applied only in respect of newly developed areas. It is also relevant to notice that in the ‘note’ put up below the TABLE I of Rule 37-A, it is clearly stated that if fee has been collected for change of land use, the fee shall not be collected for development of land. At best, the said provision can be applied only in respect of newly developed areas. It is also relevant to notice that in the ‘note’ put up below the TABLE I of Rule 37-A, it is clearly stated that if fee has been collected for change of land use, the fee shall not be collected for development of land. This provision has been overlooked by the officials of the BBMP while raising the impugned demands. The officials of the BBMP are alleged to have indiscriminately raised the impugned demands, although fee has been collected earlier while approval for development of the layout was granted by the Planning Authority or while approving the change of land use. 60. Most importantly, the learned Counsels for the petitioners are right in their submissions that the definition of the word ‘Development Plan’ as found in the Zoning of Land Use and Regulations, Revised Master Plan-2015, provides that ‘Residential Development Plan’ is a plan containing proposal for construction of one or more residential buildings on a plot measuring more than 20,000 square meters in extent. Similarly, “Non-Residential Development Plan” would mean a plan containing proposal for construction of one or more commercial building on a plot size measuring more than 20,000 square meters in extent (which was earlier 12,000 square meters). The learned Counsels are right in contending that such levy and collection of fee/cess/surcharge, etc., arising out of the provisions of the KTCP Act, 1961, is not permissible and not applicable to development plan of plots measuring less than 20,000 square meters. On a plain reading of the said provision, it is clear that such levy and collection of fee/cess/surcharge, etc., is directed towards development plans of layouts and very large constructions. It was never intended to be applied to all development plans. However, the respondent- BBMP has been indiscriminately levying and collecting such fee/cess/surcharge, etc., in respect of each and every development plan. 61. Re : Security fee – learned Counsels for the petitioners are right in their submissions that having regard to the nature of the service to be rendered by the BBMP, there is no acceptable reason as to why the applicants seeking a plan sanction/commencement certificate/ completion certificate are required to tender security fee. 61. Re : Security fee – learned Counsels for the petitioners are right in their submissions that having regard to the nature of the service to be rendered by the BBMP, there is no acceptable reason as to why the applicants seeking a plan sanction/commencement certificate/ completion certificate are required to tender security fee. As rightly contended, the very purpose for which a procedure is prescribed to seek approval of the plan for construction, is to ensure that the building is constructed in terms of the provisions of the Building Bye-laws. It would be the bounden duty of the officers of the BBMP to visit the site and ensure that the construction is put up in terms of the sanctioned plan. Any violation would meet the consequences which flow from the provisions of the Act and the Rules. That being the position, the already burdened citizens are doubly burdened by such provision. 62. Re : Ground Rent – learned Counsels for the petitioners have submitted that in Sunderam Shetty this Court has held that the levy under the said head is a blatant non-application of mind as the petitioners in most of the petitions have their own space to store or stock materials for construction and they do not require the public roads/pavements for stocking the construction materials. This Court therefore held that such owners of multistoried building/apartments and owners of large extent of land who have sufficient space to stock the building materials cannot be treated alike for the purpose of demand of ground rent. It was also observed that the citizens were hitherto paying the ground rent without raising any objections, however, by issuing a circular dated 04.09.2015, the ground rents were revised and while unreasonably raising the rate, the same was also linked with the guidance value. This has caused anguish and agony to the citizens paving the way for filing writ petitions galore challenging the action of the BBMP in demanding ground rent and linking it with the guidance value. 63. During the course of these proceedings, attention of this Court was drawn to sub-section (2) of Section 229 of the BBMP Act, which empowers the Zonal Commissioner to summarily evict any encroachment, either temporary or permanent, caused on a public street including footpath. 63. During the course of these proceedings, attention of this Court was drawn to sub-section (2) of Section 229 of the BBMP Act, which empowers the Zonal Commissioner to summarily evict any encroachment, either temporary or permanent, caused on a public street including footpath. The Zonal Commissioner is also empowered to direct such a person who has caused encroachments on public streets including footpath to remove the encroachments, and leave the place, failing which, the Zonal Commissioner is empowered to file a criminal complaint against such a person. Such being the case, the provision made in clause 3.8 of the Building Bye-laws permitting a person to stock building materials on public land/roads/pavements would be directly in the teeth of the statutory provision contained in Section 229(2) of the BBMP Act, 2020. 64. In the considered opinion of this Court, such a provision in the Building Bye-laws which is directly militating against the statutory provision contained in Section 229 of the BBMP Act cannot be sustained. It is by now well settled that a delegated legislation should conform to the statutory provisions and cannot in any way violate the statutory provisions. Moreover, this Court is also of the considered opinion that any provision which may compromise public safety and which may cause serious problems to the vehicles plying on public road and/or may cause loss or suffering to lives and limbs should be immediately terminated. While on the one hand, the statutory provision mandates public roads and pavements to be scrupulously maintained for public use, on the other hand, such provision being made in the Building Bye-laws to stock construction materials on public roads/ pavements would militate against the statutory provisions. Therefore, this Court is of the considered opinion that the provision made in the Building Bye-laws in clause 3.8 prescribing ‘ground rent’ cannot be sustained. The linking of the ground rent to the guidance value also cannot be sustained, in view of the above. 65. For the same reason, since this Court is of the opinion that the impugned levy and imposts are arbitrary, irrational and cannot be sustained, the issue regarding the validation Act and its retrospective effect, need not be gone into. 66. Re : Scrutiny Fee - Since scrutiny of the applications for sanction plan are part of the process, separate scrutiny fee cannot be levied. 66. Re : Scrutiny Fee - Since scrutiny of the applications for sanction plan are part of the process, separate scrutiny fee cannot be levied. The rate of levy will include the scrutiny fee and therefore a separate head of scrutiny fee cannot be permitted. 67. Re : Fee towards compound wall - Normally along with an application for sanction plan, no permission is sought to put up compound wall. Compound walls are constructed even without the building, for the purpose of protecting the property. It is no doubt true that the Building Bye-laws may prescribe a certain standard for measurement or height of the compound wall. However, a separate head for fee towards construction of compound wall cannot be prescribed. This Court is therefore of the considered opinion that the BBMP may prescribe a nominal fee towards construction of compound wall. 68. The impugned amended provisions contained in the Karnataka Municipal Corporations and Certain Other Law (Amendment) Act, 2021, cannot be sustained, not because of want of jurisdiction or competence, but because the power of fixing the rates for levy of fee or penalty is conferred on the Chief Commissioner, instead of the ‘Corporation’ and since the rates are based on guidance value fixed by the Department of Stamps and Registration and the same is arbitrary, irrational and unsustainable. Similar shall be the fate of the Karnataka Municipal Corporations and Certain Other Law (Amendment) Act, 2023, (Karnataka Act No.37 of 2024), which seeks to define the term ‘ground rent’, ‘guidance value’, ‘scrutiny fee’, etc., and provides for the rate of levy. The said Karnataka Act No.37 of 2024, came about during the course of the hearing of these matters and with the consent of the parties on both the sides, the learned Counsels were permitted to have their say in respect of the subsequent Amendment Act. 69. Consequently, this Court proceeds to pass the following: ORDER (i) The writ petitions are partly allowed (ii) The Karnataka Municipal Corporations and Certain Other Law (Amendment) Act, 2021 (Karnataka Act No.01 of 2022), is hereby quashed and set aside. (iii) The Karnataka Municipal Corporations and Certain Other Law (Amendment) Act, 2023, (Karnataka Act No.37 of 2024), is hereby quashed and set aside. (iii) The Karnataka Municipal Corporations and Certain Other Law (Amendment) Act, 2023, (Karnataka Act No.37 of 2024), is hereby quashed and set aside. (iv) It is hereby declared that the provisions contained in Section 18-A of the Karnataka Town and Country Planning Act, 1961, read with Rules 37-A and 37-C of the Karnataka Planning Authority Rules, 1965, are applicable only in respect of ‘Development Plan’ containing the proposal for construction on plots measuring more than 20,000 square meters in extent and not in respect of plots measuring less than 20,000 square meters. (v) It is hereby declared that if fee has been earlier collected for change of land use or while approving a layout plan, fee shall not be collected for subsequent ‘Development Plan’ in terms of the ‘Note’ found below TABLE I of Rule 37-A of the Karnataka Planning Authority Rules, 1965. (vi) It is hereby declared that the linking of the fee leviable under Rule 37-A of the Karnataka Planning Authority Rules, 1965, to the ‘market value’ or ‘guidance value’ as determined under Section 45-B of the Karnataka Stamp Act, 1957, is illegal. However, liberty is reserved to the respondent-State Government and the BBMP to re-fix a standard after collecting empherical data. (vii) Consequently, all the impugned Circulars which seek to give effect to the Rules 37-A and 37-C of the Karnataka Planning Authority Rules, 1965, are hereby quashed and set aside. (viii) It is hereby declared that Clause 3.8 of the Bengaluru Mahanagara Palike Building Bye- laws, 2003, providing for ‘Ground Rent’, is illegal and are accordingly quashed and set aside. (ix) Consequently, all the impugned Demand Notices raised by the respondent-BBMP, in respect of the writ petitioners herein are also quashed and set aside. It would be advisable that the BBMP may come out with a scheme for ‘One Time Settlement’ and settle the levy and collect the fee generally acceptable to the citizens of Bengaluru. This would also augment the present situation. 70. Pending Interlocutory Application(s), if any, stand(s) disposed of.